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Montag, 1. Oktober 2012

How Capital Went Into (And Out of) the GIPSIs

A reader of my blog pointed me to an recent articel from Paul Krugman, where he writes:

" ...........I’d like to post a good chart, but I haven’t found a clean
presentation of the data. If anyone knows how to do this, let me know!
But the basic story seems clear.

And by the way, this makes it
quite clear that to the extent that you want to talk about irresponsible
behavior, it was really a collaborative, trans-European project. German
bankers knew what the Spanish banks were doing, and in fact took on
quite a bit of the risk directly by accepting real estate as collateral."

Well Paul, I can certainly point you to the data and the charts as they are provided by the Bundesbank ( 1 ). But when I do this, I have to tell you that the irresponsible behavior you are refering to, is common place and has its roots in your very neighborhood. So you have it straight in front of your nose and you don't need to translate german charts to understand that for example Steve Keen is absolutly right, when he argues with you about endogenous money created by banks and the devastating effects they can cause with that capacity, when they initiate, for what ever reason, sudden and massive reversals of capital flows.

So I feel honored, when you, as a nobel laureate, join me in finger pointing towards the irresponsible behavior of german bankers ( 2 ). However, I would appreciate it, if you could clean up the mess at your door step first. For example by acknowledging that Steve Keens explanations are far reaching and worth to be considered seriously.

Sapere Aude!

Georg Trappe

P.S.: Steve Keens dynamic view and the exceptional Blog Querschuesse with its well prepared data deliver a far reaching explanation. More well prepared and current data regarding the engagement of german MFIs in the GIPSIs can be found here.

KABOOM!

Über mich

"Stable order is always provisional and
threatened by complexity. We should finally start thinking that we all
live on the edge of chaos. For this reason, if they were truly digested,
the theories of complexity and chaos could change our way of seeing
what happens in our cultures.They lead us to mistrust all the
totalising and totalitarian conceptions which have the pretension of
telling us with certainty what the world will be like and which
therefore supply us with the instruments to dominate as we may please –
or to help us submit to those who, in their opinion, will dominate us.
Living on the edge of chaos is also an aesthetic choice: the acceptance of living joyously with the unpredictable,
the new and the unknown. Rather than being simply the humiliation of
our arrogance, it is the renunciation of the imaginary "regular income"
of determinism and the transformation of our uncertainties into a
genuine wealth to help us to survive."

Keeling Kurve

Dynastic Cycle

Institute of Computergraphics TU Wien

Hierachy of Complexity

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Roessler Attraktor

"Real economics is the study of how people transform nature to meet their needs," said Charles Hall, professor of systems ecology at SUNY-ESF and organizer of both gatherings in Syracuse. "Neoclassical economics is inconsistent with the laws of thermodynamics."